Fennec Pharmaceuticals Inc. (NASDAQ:FENC; TSX: FRX), a specialty
pharmaceutical company focused on the development of
PEDMARK™ (a unique formulation of sodium thiosulfate (STS))
for the prevention of platinum-induced ototoxicity in pediatric
patients, today reported its financial results for the fiscal year
ended December 31, 2021 and provided a business update.
“We expect to resubmit the New Drug Application
(NDA) for PEDMARK™ to the FDA during the first quarter of
2022,” said Rosty Raykov, chief executive officer of Fennec
Pharmaceuticals. “We remain committed to making PEDMARK
commercially available to children and young adults receiving
cisplatin chemotherapy, who currently have no approved therapies
for ototoxicity.”
Financial Results for the Fourth Quarter
and Fiscal Year Ended December 31, 2021
- Cash Position –
There was a $9.2 million decrease in cash and cash equivalents
between December 31, 2021 and December 31, 2020. The net
decrease was the result of cash operating expenses, offset by the
$5.0 million received from the Bridge Bank Loan Security Agreement
and some negligible amounts received from option exercises. During
the period ended December 31, 2021, cash for operations was
used mainly on pre-commercialization activities for PEDMARK and
regulatory submission activities relating to the pending
resubmission of the NDA.
- Research and Development
(R&D) Expenses – R&D expenses were $0.5 and $5.0
million, respectively, for the fourth quarter and year ended
December 31, 2021, compared to $1.2 million and $5.1 million for
the same period in 2020.
- General and Administrative
(G&A) Expenses – G&A expenses were $3.7 million
and $12.2 million, respectively, for the fourth quarter and year
ended December 31, 2021, compared to $2.3 million and $13.0
million, respectively for the same periods in 2020. The annual
decrease in G&A was largely due to commercialization readiness
expenses for PEDMARK in 2020, which did not need to be repeated in
2021. The fourth quarter increase in 2021 over the same time period
in 2020 arose from non-cash equity grants and our
pre-commercialization activities for PEDMARK as the Company
prepared for potential NDA approval by the FDA in November
2021.
- Net Loss - Net
losses for the fourth quarter and year ended December 31, 2021 of
$4.4 million ($0.18 per share) and $17.3 million ($0.67 per share),
respectively, compared to $3.2 million ($0.13 per share) and $18.1
million ($0.76 per share), respectively, for the same periods in
2020.
- Financial Guidance
– The Company believes its cash and cash equivalents on
hand as of December 31, 2021 will be sufficient to fund the
Company's planned activities for 2022 including NDA resubmission
and commercial readiness activities.
Financial Update
The selected financial data presented below is
derived from our audited, condensed consolidated financial
statements, which were prepared in accordance with U.S. generally
accepted accounting principles. The complete audited, condensed
consolidated financial statements for the period ended December 31,
2021, and management's discussion and analysis of financial
condition and results of operations, will be available via
www.sec.gov and www.sedar.com. All values are presented in
thousands unless otherwise noted.
Audited Condensed ConsolidatedStatement of
Operations:(U.S. Dollars in thousands except per share amounts)
|
Three Months Ended |
|
Twelve Months Ended |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Revenue |
$ |
— |
|
|
$ |
170 |
|
|
$ |
— |
|
|
$ |
170 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
523 |
|
|
|
1,223 |
|
|
|
4,981 |
|
|
|
5,105 |
|
General and administrative |
|
3,684 |
|
|
|
2,293 |
|
|
|
12,242 |
|
|
|
12,950 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating
expense |
|
4,207 |
|
|
|
3,516 |
|
|
|
17,223 |
|
|
|
18,055 |
|
Loss from
operations |
|
(4,207 |
) |
|
|
(3,346 |
) |
|
|
(17,223 |
) |
|
|
(17,885 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Other
(expense)/income |
|
|
|
|
|
|
|
|
|
|
|
Amortization expense |
|
(8 |
) |
|
|
— |
|
|
|
(16 |
) |
|
|
(402 |
) |
Unrealized (loss)/gain on securities |
|
(162 |
) |
|
|
100 |
|
|
|
(25 |
) |
|
|
100 |
|
Other loss |
|
(63 |
) |
|
|
(5 |
) |
|
|
(136 |
) |
|
|
(9 |
) |
Interest income |
|
13 |
|
|
|
13 |
|
|
|
54 |
|
|
|
87 |
|
Total other (expense)/income, net |
|
(220 |
) |
|
|
108 |
|
|
|
(123 |
) |
|
|
(224 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
$ |
(4,427 |
) |
|
$ |
(3,238 |
) |
|
$ |
(17,346 |
) |
|
$ |
(18,109 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Basic net loss per
common share |
$ |
(0.18 |
) |
|
$ |
(0.13 |
) |
|
$ |
(0.67 |
) |
|
$ |
(0.76 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net loss per
common share |
$ |
(0.18 |
) |
|
$ |
(0.13 |
) |
|
$ |
(0.67 |
) |
|
$ |
(0.76 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Audited Condensed Consolidated Balance
Sheets(U.S. Dollars in thousands)
|
December 31, 2021 |
|
December 31, 2020 |
Assets |
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
21,100 |
|
|
$ |
30,344 |
|
Other current assets |
|
1,287 |
|
|
|
1,073 |
|
Non-current assets, net |
|
27 |
|
|
|
— |
|
Total Assets |
$ |
22,414 |
|
|
$ |
31,417 |
|
|
|
|
|
|
|
|
|
Liabilities and stockholders’ equity |
|
|
|
|
|
|
|
Current liabilities |
$ |
1,654 |
|
|
$ |
2,347 |
|
Non-current liabilities, net |
|
4,988 |
|
|
|
— |
|
Total stockholders’ equity |
|
15,772 |
|
|
|
29,070 |
|
Total liabilities and stockholders’ equity |
$ |
22,414 |
|
|
$ |
31,417 |
|
|
|
|
|
|
|
|
|
Working Capital |
|
Fiscal Year Ended |
Selected Asset and Liability Data: |
|
December 31, 2021 |
|
December 31, 2020 |
(U.S. Dollars in thousands) |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
21,100 |
|
|
$ |
30,344 |
|
Other current assets |
|
|
1,287 |
|
|
|
1,073 |
|
Current liabilities excluding derivative liability |
|
|
(1,654 |
) |
|
|
(2,347 |
) |
Working capital |
|
$ |
20,733 |
|
|
$ |
29,070 |
|
|
|
|
|
|
|
|
Selected Equity: |
|
|
|
|
|
|
Common stock & APIC |
|
$ |
194,015 |
|
|
$ |
189,967 |
|
Accumulated deficit |
|
|
(179,486 |
) |
|
|
(162,140 |
) |
Stockholders’ equity |
|
|
15,772 |
|
|
|
29,070 |
|
|
|
|
|
|
|
|
|
|
About PEDMARK™
Cisplatin and other platinum compounds are
essential chemotherapeutic agents for many pediatric malignancies.
Unfortunately, platinum-based therapies cause ototoxicity, or
hearing loss, which is permanent, irreversible and particularly
harmful to the survivors of pediatric cancer.
In the U.S. and Europe, it is
estimated that, annually, over 10,000 children may receive
platinum-based chemotherapy. The incidence of ototoxicity
depends upon the dose and duration of chemotherapy, and many of
these children require lifelong hearing aids. There is currently no
established preventive agent for this hearing loss and only
expensive, technically difficult and sub-optimal cochlear (inner
ear) implants have been shown to provide some benefit. Infants and
young children that suffer ototoxicity at critical stages of
development lack speech language development and literacy, and
older children and adolescents lack social-emotional development
and educational achievement.
PEDMARK has been studied by cooperative groups
in two Phase 3 clinical studies of survival and reduction of
ototoxicity, The Clinical Oncology Group Protocol ACCL0431 and
SIOPEL 6. Both studies have been completed. The COG ACCL0431
protocol enrolled childhood cancers typically treated with
intensive cisplatin therapy for localized and disseminated disease,
including newly diagnosed hepatoblastoma, germ cell tumor,
osteosarcoma, neuroblastoma, and medulloblastoma. SIOPEL 6 enrolled
only hepatoblastoma patients with localized tumors.
The Marketing Authorization Application (MAA)
for sodium thiosulfate (tradename PEDMARQSI) is currently under
evaluation by the European Medicines Agency (EMA).
PEDMARK has received Breakthrough Therapy and Fast Track
Designation by the FDA in March 2018.
About Fennec Pharmaceuticals
Fennec Pharmaceuticals Inc. is a specialty
pharmaceutical company focused on the development of
PEDMARK™ for the prevention of
platinum-induced ototoxicity in pediatric patients. Further,
PEDMARK has received Orphan Drug Designation in the U.S. for this
potential use. Fennec has a license agreement with Oregon
Health and Science University (OHSU) for exclusive worldwide
license rights to intellectual property directed to sodium
thiosulfate and its use for chemoprotection, including the
prevention of ototoxicity induced by platinum chemotherapy, in
humans. For more information, please
visit www.fennecpharma.com
Forward Looking Statements
Except for historical information described in
this press release, all other statements are forward-looking. Words
such as “believe,” “anticipate,” “plan,” “expect,” “estimate,”
“intend,” “may,” “will,” or the negative of those terms, and
similar expressions, are intended to identify forward-looking
statements. These forward-looking statements include the Company’s
expectations regarding its interactions and communications with the
FDA, including the Company’s expectations and goals respecting the
resolution the issues raised in the CRL and the Company’s plans to
address them, and the anticipated timing of the Company’s
finalization and filing of an NDA resubmission for PEDMARK.
Forward-looking statements are subject to certain risks and
uncertainties inherent in the Company’s business that could cause
actual results to vary, including such risks and uncertainties
relating to the Company’s reliance on third party manufacturing,
the risk that unforeseen factors may delay the resubmission of the
NDA, the risks of delays in or failure to obtain FDA approval of
PEDMARK, the risks relating to the Company’s and its manufacturer’s
ability to adequately address the concerns identified in the CRL,
the risk that the resubmission of the NDA to the FDA will not be
satisfactory, that regulatory and guideline developments may
change, scientific data and/or manufacturing capabilities may
not be sufficient to meet regulatory standards or receipt of
required regulatory clearances or approvals, clinical results may
not be replicated in actual patient settings, unforeseen global
instability, including political instability, or instability from
an outbreak of pandemic or contagious disease, such as the novel
coronavirus (COVID-19), or surrounding the duration and severity of
an outbreak, protection offered by the Company’s patents and patent
applications may be challenged, invalidated or circumvented by its
competitors, the available market for the Company’s products will
not be as large as expected, the Company’s products will not be
able to penetrate one or more targeted markets, revenues will not
be sufficient to fund further development and clinical studies, the
Company may not meet its future capital requirements in different
countries and municipalities, and other risks detailed from time to
time in the Company’s filings with the Securities and Exchange
Commission including its Annual Report on Form 10-K for the
year ended December 31, 2021. Fennec disclaims any
obligation to update these forward-looking statements except as
required by law.
For a more detailed discussion of related risk
factors, please refer to our public filings available
at www.sec.gov and www.sedar.com.
For further information, please
contact:
Investors:Robert AndradeChief Financial
OfficerFennec Pharmaceuticals Inc.(919) 246-5299
Media:Elixir Health Public RelationsLindsay
Rocco(862) 596-1304lrocco@elixirhealthpr.com
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